The Kenyan Shilling weakened further against the United States Dollar on Wednesday following an increase in the demand for foreign currency.
According to the London Stock Exchange Group (LSEG), the local currency slipped as importers and manufacturers sought more dollars to conduct their trade.
A high demand for the US currency posed pressure on the exchange rates thus causing the local unit to weaken.
As of Wednesday, September 18, the shilling traded at 129.05 compared with Tuesday’s closing rate of 128.50.
A man counting several one thousand Kenyan shillings bills.
Photo
Wilberforce Okwiri
The sudden easing of the local currency was also attributed to the recent resurgence of the dollar which has been stabilising against major global currencies.
However, the latest slip by the Kenya currency was considered marginal compared to the previous month where it weakened to a staggering Ksh134 against the greenbuck.
The shilling’s current status against the dollar contradicts the recent prediction by analysts that the local currency would strengthen this week to Thursday.
The experts who spoke to Reuters late last week noted that the shilling would remain stable for a better part of this month on an increased dollar inflow.
“We’re stuck within this range. The local currency has reached a stable zone,” noted an analyst who spoke to the publication.
According to the experts, the shilling would strengthen following the recent government decision to float infrastructure bonds and due to an intervention by the Central Bank.
Nonetheless, the local currency has for a better part of the year remained stable following the government’s decision to implement favourable monetary policies.
The shilling which began stabilisng in February this year, has been on an exemplary form majorly contributed by the government’s move to repay its Eurobond debt that matured in June.
Kenyan shilling notes and coins
Photo
SMG
